I am pleased to appear before the Committee concerning the International Space Station (ISS). Let me begin by expressing the appreciation of the entire NASA team for the overwhelming vote of confidence given us by the House on July 29 with respect to the ISS. NASA intends to continue our efforts to merit that confidence. I believe the sound support for the ISS displayed by both houses of Congress over the past month reflects a conviction on their part that the ISS is a critical investment in the Nation's future and confidence that NASA and our International Partners will succeed in establishing this valuable, on-orbit capability despite the challenges we face.

The President and the Congress have given NASA the responsibility of leading the partnership of 15 nations to the successful development of this unprecedented orbiting laboratory. For the most part, we have had great success and cooperation with our partners; to date, they have produced over 100,000 pounds of flight hardware for the ISS. The launch of the first of the major Station elements, Sunrise (Zarya), the Control Module (or FGB) is approximately three months away. Sunrise is currently at the launch site in Baikonur undergoing final checkout. Launch of the second major element, Unity (or Node 1), is less than four months away. Unity was delivered to the Kennedy Space Center (KSC) one year ago, and is undergoing final preparation and checkout, along with two Pressurized Mating Adapters. Several other key elements have also been delivered to KSC, including the Z-1 truss and third Pressurized Mating Adapter in preparation for launch next year. A very complex piece of equipment, the Integrated Electronics Assembly, is now being outfitted at KSC, with critical components of the power system, in preparation for a mid-1999 launch. We expect the U.S. Laboratory module and remaining flight hardware for the first six flights to be delivered to their respective launch sites by the end of 1998. Our international partners are generally performing well. The Multi-Purpose Logistics Module was delivered to KSC by the Italians last month. Next month, the Canadian Space Agency will deliver the robotic arm to KSC. The Service Module is undergoing integration and test at Energia. In preparation for assembly, we bring forward the following important issues, and how we plan to address them.

The Russian government's financial situation and the ability of the Russians to fully meet their commitments to the ISS is a concern for the United States and the rest of our partners in the Program. The key point I wish to emphasize today is that we are initiating further steps in our contingency plan, within the FY 1998 enacted budget and the Administration's FY 1999 budget request, to provide backup capability in case of potential Russian shortfalls. In order to be in a position to respond to financial shortfalls in Russian funding for the ISS, we will continue to study further contingency steps. We will identify the cost of these further steps in the formulation of our FY 2000 budget. Also as part of the formulation of the FY 2000 budget, we are planning steps to further reduce cost and schedule risk defined in the Cost Assessment and Validation (CAV) Report. I believe these actions are essential in order for NASA and its partners to complete the ISS on the earliest schedule and at the least cost to the U.S. taxpayer.

This Committee is well aware that Russia is a vital member of the ISS partnership. Russia has more experience in long-duration space flight than any other nation, and is bringing phenomenal technical and engineering expertise to the ISS. However, of the $340 million needed for Russian ISS contributions in calendar 1998, only $160 million has been budgeted, to provide for only the most essential items. No funding has been provided to RSA since earlier this year, and the total 1998 funding allocated to RSA to date is only $20 million. Assembly of the Service Module is 98 percent complete; final outfitting and testing of the module's systems is underway. Although RSA continues to report some technical progress is being made, NASA is concerned that the shortfall in funding available to RSA places the scheduled April 1999 launch date for the Russian Service Module at some risk. Production of Soyuz and Progress vehicles has virtually ceased due to non-delivery of components.

Working with the Administration, NASA has laid out a comprehensive plan which would allow us to move the ISS Program forward, maintain the Russian partnership based upon their economic ability, and achieve greater U.S. backup capability over the next several years. The objectives of this plan are to contain U.S. cost growth, protect the ISS schedule, and maintain program stability, while providing backup capability in the event of further Russian shortfalls.

While RSA has made extraordinary progress with the level of funding received for the Service Module development -- and I salute Mr. Koptev, Director General of RSA, for such outstanding performance under such funding conditions -- it is clear that the timely completion of this important international project is at risk should the shortage of Russian funding continue. The most pressing need now is the completion and launch of the Russian Service Module, as planned, to provide initial life-support capability, propulsion, and attitude control for the ISS. To assure a timely launch of the Service Module, NASA is presently engaged with RSA to understand their fiscal situation and define appropriate steps.

There is an equally essential task before the Russian Space Agency that is vying for limited financial resources: the deorbit of the Mir space station. Critical funding to safely de-orbit this vehicle over an uninhabited expanse of ocean must be made available by the Russian Government immediately. It is their responsibility to the Russian people and to the global community. I firmly believe that RSA will step up to the technical challenge and safely accomplish this duty given the appropriate financial resources.

Without question, we intend to maintain the Russian partnership in this international program, but a solution must be found to ensure that the ISS is assembled in a timely manner and sustained safely and effectively with the necessary crew and logistics resources. Russia has proven experience accumulated over many years living and working in the harsh environment of space. I can tell you that the future of ISS will be more prosperous, for all the Partners, with continued Russian involvement.

We have realized very substantial benefits as result of the Phase 1 Program. System redundancy, safety and significant improvements in the efficiency of scientific experimentation learned from the Mir experience are being incorporated into the ISS design. Resources, in time and money, that might have been spent to learn costly lessons through inexperience will now be used to conduct important, perhaps life-saving, scientific activity. The very significant commitment of our two countries to work together and especially to trust one another, to learn from each other's strengths and weaknesses, and to jointly use each other's significant space infrastructure toward a meaningful peaceful purpose can not be allowed to end with the Phase I Program. As an example, Soyuz is critical to providing safe crew return early in the program during the assembly phase. It took many years for each nation to lay the foundations that brought us together for the betterment of the whole. There are too many benefits to be realized for the U.S. and for Russia to let this new, effective partnership built disintegrate. We have built an effective team that can, and will, provide valuable insight and capability in the assembly, operations and maintenance of the ISS.

At this Committee's urging and direction, NASA had earlier developed and has begun implementing contingency plans to enable the ISS Program to continue despite possible further delays in the Russian contributions. As the first step in this contingency effort, we undertook development of an Interim Control Module (ICM). While we have baselined the Service Module, development of the ICM will continue as a backup propellant vehicle for late or non-delivery of Progress logistics flights.

We are now immersed in refining this contingency plan. Funding to RSA in the near-term is of great concern to the ISS Program. The Administration has reinforced this concern at the very highest levels of the Russian government. We are currently engaged in discussions with the Russians to determine how best to ensure that their contributions are adequately funded, reliably produced and delivered. As the leader of this international program, I believe our close involvement in addressing RSA's problems is necessary to ensure predictability in the near term assembly of the ISS and to reduce the impact of potential further delays in Russia meeting its schedule commitments to the ISS.

The second element of our plan involves development of U.S. capabilities necessary to provide backup for Russian contributions over the next several years. Yesterday, we notified the Committee of our intent to reallocate funds within our FY 1997 Operating Plan to modify the Shuttle Reaction Control System to facilitate the periodic reboost of the ISS. This enhanced Shuttle reboost capability will provide flexibility in meeting a substantial portion of Station reboost requirements.

We have identified several other contingency options which could provide additional backup to Progress for reboost, but not eliminate the need for Progress vehicles. Shuttle missions could carry more propellants in their Orbital Maneuvering System (OMS) tanks, at a sacrifice per mission by offloading payload, to provide ISS reboost. Use of the ICM as a propellant module and, in the longer term, combined with use of the International vehicles, will provide further flexibility to reduce the reliance on the Progress vehicles. The European ATV and Japanese HTV could provide significant capability in the outyears. The Europeans plan to deliver six ATV's, which could deliver propellant equivalent to about sixteen Progress flights. The HTV will provide dry goods and complement the capability of the ATV. Both are in the early, requirements definition phase, and are not planned to be available earlier than 2003.

To be in a position to take additional action downstream for a full backup capability, NASA has initiated a technical definition study for a propulsion module which would provide the attitude control and reboost capability needed, should the Russians be unable to provide any Progress vehicles in the future. A formal industry cost estimate is expected later this month. NASA will complete an evaluation of this cost estimate by early September, and examine the option as part of the FY 2000 budget process. Development of a U.S. propulsion module, coupled with the ESA Ariane Transfer Vehicle (ATV) and Japanese HTV, could provide complete backup to Russian vehicles for ISS attitude control and reboost. A propulsion module could be both a prudent back-up measure, in the event of serious Russian shortfall, and a useful redundancy capability, the need for which we learned as a result of experience during the Phase I Shuttle/Mir Program.

As you know, in October 1997, in order to assist NASA in identifying risk areas to the ISS, I chartered the CAV Task Force on the ISS to perform an independent review and assessment of costs, budgets, and partnership performance. As I stated in my testimony last month, the CAV Report concludes that NASA is trying to do too much with too little. This is not atypical of NASA, but in the case of the ISS, perhaps we have been too ambitious. This translates into a certain level of risk in terms of the potential for missing cost, schedule and technical targets; a risk level which may be actively reduced by the right actions. In fact, the essence of the CAV recommendations, along with our own internal assessments which are in place, is to formulate specific risk-reducing actions that the Program may choose to take in the future. NASA agrees with the key risks cited in the Report, and has undertaken steps to address the most urgent risks within the FY 1998 budget. We will spend the next few months carefully reviewing additional steps, examining other alternatives, and assessing the urgency for making these changes. The results of these efforts will be reflected in the FY 2000 budget.

In the Chairman's letter requesting my testimony for this hearing, he asked that NASA report on the status of development of the U.S. Crew Return Vehicle (CRV). We have an excellent team working on the X-38 project which I am confident will find ways to minimize cost and schedule risk to the CRV program. The current plan for the X-38 project calls for continued flight testing of the four CRV prototypes. The first prototype vehicle performed a successful flight test and parafoil landing in March 1998. It will fly again in October. The X-38 team, made up almost entirely of NASA employees and several European specialists, accepted my challenge and has performed an extraordinary job in producing and testing the prototype vehicles. Through a no-cost contract arrangement, we now have four aerospace firms on-board observing this project. We believe this will provide for a smooth transition into the CRV program. When we are confident that we can proceed to production within budget guidelines, we will build four operational CRV's.

The U.S. CRV will not be available until 2003 at the earliest. To bridge the gap between six-person crew and expected CRV availability, NASA is exploring the use of additional Soyuz vehicles to meet our own obligations. Two to four Soyuz vehicles would be required to cover the gap.

In response to the Committee's interest in the total uncosted carryover into FY 1999 for the ISS and the Russian Program Assurance Project (RPA) efforts, we currently project approximately $450 million. This is the equivalent of about two and one half months at the current spend rate. RPA ($97 million) and ISS Operations ($180 million) are the two largest contributors to NASA's carryover estimate. Some spending on RPA has been delayed due to the timing of the decision on use of the Interim Control Module, which is being built by the Naval Research Laboratory for NASA.

In ISS Operations, we have re-phased the Prime Spares and Sustaining Engineering spending plan relative to the original plan. The spares build-up profile for the ISS has been rigorously reviewed over the past year, and a determination has been made to delay acquisition of a portion of the spares inventory. A period of detailed negotiations with Boeing over the correct level of sustaining engineering led to a slower buildup of sustaining engineering than had been planned. Also, the planned buildup of the ground operations infrastructure, including the Space Station Control Center and Training Facility, has been re-phased for more appropriate alignment with the schedule.

In summary, we are taking specific steps to develop backup capabilities to address potential Russian shortfalls. This will enable the ISS Program to move forward with reduced risk, reduced cost growth and with prudent backup capabilities in place and under development. With these issues resolved, we can move toward the excitement and challenge of on-orbit assembly and operation of the first world class international space station, and toward the untold discoveries that await us.